For many years, the discussion about the housing market has been mostly negative, with everyone wondering if we would ever get back to the prices and building activity of the early 2000s. And while we are not all the way back, 2013 was a year when the housing market made steady progress toward a rebound, and it looks like 2014 could be a continuation of this trend.
“Through November, housing starts in Wayne, Oakland, Macomb and St. Clair Counties are up over 30 percent from 2012 levels,” said Michael Stoskopf, the executive director of the Home Builders Association of Southeastern Michigan, (248) 737-4477, www.builders.org.
According to Stoskopf, the recent heyday of home building came during the 2002-2003 years, when the busy months could reach 1,000 permits in this four-county area, and a slow month would be around 700. But he said this past year permits are starting to reach the levels we haven’t seen since 2004 and 2005. “We had seven months from April through October where we averaged 400 permits, and we are likely to see a total of around 5,000 permits for 2013 when the numbers come in,” he said.
That compares with a year like 2009, when there were only 1,000 permits, so it is obvious we are on the upswing. That upswing extended to the price of homes for sale as well in 2013 in the area.
According to the November, 2013 statistics from Realcomp, (866) 553-3003, www.realcomp.com, the real estate multiple listing service, the median selling price for homes in the area rose by 41 percent, and marked the ninth straight month that home sale prices rose double digits. That includes a 44 percent jump in November sales prices for homes sold in Wayne County versus 2012 numbers, a 28 percent increase in Oakland County, a 43 percent rise in Macomb County and an 18 percent increase in Livingston County.
And while statistics like these give you a warm, fuzzy feeling regarding our housing market, the positive trend is something even Realtors are seeing more regularly.
“Sales prices seemed to take off in March, and we saw that would continue throughout the traditional home sales season,” said John Yugovich, a Realtor with Keller Williams in Farmington Hills, yugovich.yourkwagent.com, (248) 790-8424. “Homes were selling fast in 2013, and often with multiple offers over the asking price,” he said. “In August, I even raised the price of some listings to reflect the rise in sales prices.”
Chris Courtney, a Realtor with Remerica Hometown in Plymouth, (734) 459-6222, www.remerica.com, agrees that things were looking up in 2013. “We also saw appraisers making subtle adjustments upward in their home appraisals in 2013 to reflect the market changes, so that is a positive for the housing market,” Courtney said. “I think we will continue to see a positive market in 2014.”
That same sentiment about a positive 2014 is shared by Stoskopf. “Based on our forecasting model, we can see a 20-30 percent increase in housing permits in our area for 2014,” Stoskopf said.
The rise in housing prices and new building permits definitely translated into big attendance numbers at last year’s home shows in the area. And according to Stoskopf, that trend should continue in 2014.
“In 2013 our attendance numbers for our shows in Novi were the largest since 2005, and already we are close to selling out our exhibitor space for the January show, and the April show is also selling very well,” he said. “We expect attendance numbers to remain strong, as well.”
With all the optimism for the housing market in 2014, there is one caution that Stoskopf mentioned. “During the past few years the building labor base in our market has been decimated as both companies and qualified subcontractors have left to find work elsewhere,” he said. “The lack of qualified contractors could be an issue for 2014.”
That will not only impact new home building, but also the remodeling market. That’s why I tell you to plan ahead if you want anything done, because the good contractors are always busy. And if the positive housing trend continues this year, the planning cycle to get things done could get even longer until we see contractors who left our market coming back home. But that is a price I am willing to pay for a better home market.
If you would like to suggest a question for this column, email firstname.lastname@example.org. If you want to talk to Glenn Haege, call his “Handyman Show” on WJR-AM (760) at (866) ASK GLENN, (866) 275-4536 between noon and 2 p.m. Saturday and Sunday. The “Handyman Show” can be heard on more than 130 radio stations.